Dear Mayor Higgins:
A short while ago I received copies of correspondence between the City of Northampton and former Director of Public Works, Sam Brindis. The subject of the correspondence was your determination that he and approximately ten other former employees who elected to take the deferred retirement option available to them through the Massachusetts State Retirement System are no longer eligible to secure health insurance coverage through the city when he/they submit/s their application for their state pension benefits.
I also was referred to two articles in The Valley Advocate, one on June 7, 2007 entitled, “Health Benefits No More” and the second, “Folklore Policy” on August 9, 2007. In addition, I read with great interest the transcript of the interview you provided Daryl G. LaFleur also formalized on The Valley Advocate’s website on August 8, 2007. Frankly, I am surprised by some of your statements, as they are not entirely correct and very misleading.
First, there was as you acknowledged a long standing practice to permit employees who elected to take the deferred retirement option to enroll in an appropriate health insurance plan simultaneously with the filing of their application for state retirement benefits. Such was communicated to them for at least two decades if not longer and supported and administered by two former City Treasurers, two former Personnel Directors and all of their staff. And while it is true that there was no governing written policy to provide and administer such benefits, it is astonishing to me that you would characterize the practice as “folklore.” Those employees who chose to take the deferred retirement option,* which was their absolute legal right pursuant to Massachusetts General Law, Chapters 32A and 32B, relied in good faith on the aforementioned city officials who were at the time, agents of the City. In my judgment, your unilateral determination to deprive this small group of retirees of their right to secure health insurance coverage that traditionally always has been provided to all city retirees is morally unconscionable. In addition, it may constitute an illegal action (breach of contract for detrimental reliance) according to human resources professionals and attorneys to whom I have spoken.
* “Prior to retirement, an insured employee who terminates his service with the commonwealth and who has a right to retire but whose retirement is deferred as provided in section ten of chapter thirty-two shall for the purposes of this chapter only be deemed to have been granted a leave of absence without pay, and may continue all insurance coverages to which he would have been entitled if he had not terminated his services;?”
Secondly Mayor, you and at least two, long-time City Councilors, James Dostal and Michael Bardsley, were always staunch and steadfast advocates of retirees and their rights and are very knowledgeable about labor law and management issues. Both Councilors know very well that to execute a policy and apply its terms retroactively to former employees/retirees is inappropriate and I suspect, realize that it is legally questionable (ex post facto law). Apparently however, it is not politically expedient for either Councilor to stand up for and represent this small group of retirees.
You stated in the articles published in The Valley Advocate as well as in the transcript that you or your staff contacted a number of other communities to research the issue of limiting eligibility to this small group of special retirees. You asserted that the Town of Amesbury has a similar policy. Did you have your current HR Director Glenda Stoddard contact any adjacent or nearby communities? If you had, you would have found that very few communities if any at all have a defined policy that excludes deferred option retirees. You would have also learned that none of the communities apply its terms retroactively. A far fairer and more consistent approach, and in the manner, in which the city has dealt with employee/retiree issues in the past, would have been to adopt a similar policy such as the one that exists in the Town of West Springfield (see enclosure). The Town of West Springfield’s application of the policy is prospective, not detrimental to deferred option retirees whom I might add, includes past city elected officials and provides a reasonable time period for all those affected to make an informed decision.
You also stated in the transcript that the driving force behind limiting this “eligibility coverage” was GASB-45. I am confused as to how the implementation of this financial accounting tool morally justifies the revocation of a long-standing practice to provide health insurance to deferred option retirees. Barring your good intentions in providing cost savings, I’m certain Northampton residents would feel a strong sense of betrayal by your unilateral repudiation of years of good faith in administrative practice.
The city has a policy of Non-Discrimination, Number 200-2, which clearly states that the City will refrain from discrimination “in the provision of, or access to services, employment and activities,” and shall interpret such actions [by those who do] “so as to protect liberally the substantial rights of [the] interested persons.” In reviewing the transcript, you acknowledged there were some deferred option retirees who in fact until the recent policy was executed, were allowed to enroll in health insurance coverage. Since you applied the policy retroactively, were any deferred option retirees or for that matter, any retirees at all, communicated to or given the opportunity to enroll in health insurance coverage before you decided to “ limit their eligibility?” From a legal perspective, they all have a sufficient interest or right at stake, and common sense knowledge of fair business practices should have dictated an opportunity to be heard prior to your unilateral action.
According to the transcript, you mentioned to Mr. LaFleur that you are in possession of a legal opinion that supports your actions with regard to the eligibility issue of deferred option retirees. He has requested a copy of that opinion on two separate occasions and in speaking with him recently, I understand you have yet to make it available to him. I also understand that the Northampton Retirement Board last year requested a formal opinion on the same matter, not from the jurisdictional Public Employee Retirement Administration Commission (PERAC) but from their attorney. Since the legal relationship between their attorney and the Northampton Retirement Board is different than one of a private individual to his/her attorney at least with respect to confidentiality matters, PERAC legal representatives have advised me that this opinion should also be made public. And since that should be readily available and not require any significant research time, would it be fair to assume that the costs for requesting such copies should be minimal in contrast to the total of $350.00, Mr. Brindis was quoted from City Solicitor Sheppard for trying to secure similar and related information? Pursuant to the Freedom of Information Act, I am formally requesting copies of both opinions.
Initially, according to Mr. LaFleur, you alleged that this matter was not under the purview of the Insurance Advisory Committee, since their functions are only advisory in nature. While no one disputes your right to make policy changes prospectively, it seems that the least you could have done was to have brought this matter before the Committee, if simply for discussion purposes. I recall that along with the presidents of all the municipal bargaining units, the Committee makeup pursuant to law still includes a retiree designee. The current designee however, does not recall this matter ever coming before the Insurance Advisory Committee and was completely unaware of the policy even though its application affected this small group of retirees, active employees who will retire, and those who have retired and may wish to amend their coverage based on qualifying events. If in fact it was brought before the Committee, as you asserted in the transcript, certified minutes of that public meeting including its agenda should also be made public. After all, the fundamental nature of the change in past practice (depriving deferred retirement option retirees of continued health insurance coverage) should have been the most compelling reason to secure the opinion of the Insurance Advisory Committee. Again, pursuant to the Freedom of Information Act, I am formally requesting copies of those certified minutes.
The ten plus people who elected to take the “deferred retirement option” worked for the City of Northampton and on behalf of its residents for a minimum of ten years; some longer—they were dedicated and hard working, and understood and believed that if they stayed long enough to earn the benefit they were promised, it would be there for them when it came time for them to retire.
On behalf of those retirees, I would ask you to reconsider amending the policy to make it prospective and continue to honor the words and administrative practices of past administrations.
Sincerely yours,
Don R. Teres
Former HR Director
(01/1991-7/01/2003)
cc: Northampton City Councilors
Northampton Retirement Board
The Public Employee Retirement Administration Commission
MA Municipal Association of Retirees, W. Reyrey
AARP – Legal Advocacy
Washington, D.C.
